Bay St. Louis attorney Stephen Benvenutti told the council the city’s comprehensive zoning ordinance was never published, as required by law, when it was adopted by the previous City Council in 2010.

Municipalities are legally required to publish zoning change proposals and other significant measures in the municipality’s local newspaper within 30 days of a council’s vote. The newspaper of record for municipalities in Hancock County is the Sea Coast Echo.

The display of ineptitude inherent to not following simple, statutorily mandated tasks such as keeping a codified book of municipal ordinances and publishing them after Council adoption by Mayor Fillingame and his appointees is stunning, though not surprising. The fact is this problem was identified in 2015 by the FY 2014 auditors at Wright Ward Hatten and Guel. Here is what the state auditor wrote in their Performance Review of that audit:

According to Mayor Fillingame, long time City Clerk Kolf does not know how to properly code the monthly installment of the City’s insurance policy, but nobody believes that as there has been no general fund docket to speak of for months.

Ward resigned from the seven-member Harbor Commission two weeks ago, firing off an email, obtained by the Sun Herald, to the council.

“I feel that eventually we will all be embarrassed in a public financial disaster that is not in our control,” the email said. “The administration has not and will not provide us with accurate and up to date information to make any type (of) decision or planning. (Mayor Les Fillingame) doesn’t provide it to the council and (the) council accepts it that way.”

On Monday, Ward told the Sun Herald he believes the city intentionally took the money out of the harbor fund to cover its own approaching insurance payment.

My mind is open to the possibility the patient is in a permanent state of terminal illness.

I happened to be at the City Council meeting where Fire Chief San Fillippo gave her departmental update to the City Council. I did not hear anything about having to close the Highway 603 Fire Station. The troubling thing is how the whole thing was treated when questions started being asked and what is missing from the equation is basic professionalism:

I have had a few phone calls about the fire station on 603 being shut down with a note on it telling you to call Main St. Station. Does anyone know anything about this?? We just had a meeting 3 days ago and nothing was said. Nothing has been said about being short handed to where it may affect our services!! I said may !! Nothing was said during budget , Pam said they would look at things after the 1st of the year. If we are short we must fill the positions now!! Is this a money issue ???? Do we need to meet NOW on this?? Will someone fill us in on this immediately. Thanks, Mike

This post could turn into a multi-chapter book on the myriad of terminal illnesses permanently afflicting our little Mayberry by the Sea but when the financial plan is to spend the last nickle cash flow shortages are bound to happen. And when the secular level of taxation does not account for equipment depreciation, there is no money to affect repairs when old equipment breaks. Speaking of that old Bay Fire Equipment, I saw some of it yesterday morning at the Hardees in Waveland but that is not the topic of this post no sir. See folks, go to a council meeting and its generally all smiles and tulips but behind the scenes: Continue reading “Meantime back here in the Bay…..”

Before entering into any lease agreement pursuant to this chapter secured by a pledge of its full faith and credit, the governing authorities of any county or municipality shall publish notice of their intention to receive suitable proposals for the leasing of such buildings, facilities or equipment. Such notice shall specify the nature of the proposed building, facility or equipment, the general geographic area in which the same is to be located, the term of the proposed lease agreement, that the obligation to pay rentals during the primary term is to be a continuing obligation of and a charge against the general credit and leasing power of the county or municipality, and the date and hour on or before which such proposals may be received. Such notice shall be published by municipalities and counties in the same manner as required for publishing notice of intention to issue general obligation bonds of the county or municipality, as appropriate. If at least twenty percent (20%), or fifteen hundred (1500), of the qualified electors of a county, whichever is less, or at least ten percent (10%), or fifteen hundred (1500), of the qualified electors of a municipality, whichever is less, file a written protest with the appropriate governing authorities, then an election shall be called by the county in the same manner as provided for the issuance of county general obligation bonds in Sections 19-9-11 through 19-9-17, Mississippi Code of 1972, or by a municipality in the same manner as provided for the issuance of municipal general obligation bonds in Sections 21-33-307 through 21-33-311, Mississippi Code of 1972, to determine whether or not the proposed lease agreement may be executed by the county or municipality. The lease agreement shall be advertised for competitive sealed proposals once each week for two (2) consecutive weeks in a regular newspaper published or having a general circulation in the county or municipality of the governing authority. The date as published for the proposal opening shall be not less than five (5) working days after the last published notice. The lease shall be awarded to the person submitting the lowest and best proposal; however, all proposals may be rejected.

According to a Public Records Request Return to the Hancock County Alliance for Good Government from Bay St Louis City Hall, none of the three full faith and credit capital leases entered into by the City over the past three years, including the fire trucks which caused such a ruckus in the social media early this year, were advertised pursuant to the law, yet now the citizenry is getting stuck with an Ad Valorem Tax Levy to pay them off. Stay tuned.

Folks I’ve been very busy all week in the day job but have monitored the slow motion financial meltdown of the City of Bay St Louis, a problem that has been literally years in the making.

Last year during the election then Mayoral candidate Jeff Harding had the city’s financial problems well identified. His claims were dismissed, buried in the re-election campaign of lies told by the Mayor Les Fillingame which contended the City was financially sound, a meme Hizzoner would keep repeating until late Spring of this year when he revealed the City would default on its Water and Sewer Bonds unless they were refinanced immediately, a move that left the City almost $200,000 further in debt. By that time, per the 2013 single audit report, the City’s Water and Sewer fund accumulated deficit was well over $400,000. The City has been broke for over a year.

What can I say folks but in respect the recessed meeting of the Bay St Louis City Council was a bit of a zoo but first a comment bump:

You will note that it is incontrovertible: Reed has passed the point of no return, for no longer are the serfs laughing with him, they are now laughing at him.

I thought of Empire Parish a couple of times when the assembled crowd openly laughed, hissed and cat called on a couple of occasions when City Clerk Kolf or Hizzoner told a whopper. We had Hizzoner bring in the Hancock Bank Bond Trustee to finger wag and lecture the City Council. Best of all though is those assembled last night saw the City Council well discharge its fiduciary duties to the voters and taxpayers of Bay St Louis. The Mayor, OTOH, came very close to losing it after he did not get his way in continuing the taxpayer funded spending binge he has been on for the last five years.

First up is WLOX and Al Showers because I heard early this morning that I was on the TeeVee though there is no link to any Bay St Louis reporting on the WLOX website. I figured since Al was filming the crowd…..

Last Thursday evening the Bay St Louis City Council held a recessed meeting that was devoted almost entirely to the troubled state of the City’s finances. Audit report excerpts were read, sweeping proclamations regarding accountants being meek were declared and into nonsalient side subjects was the discussion frequently steered. And yet through it all the public still managed to learn a few things. I thought Geoff Belcher did a great job with his recap of the meeting for the Seacoast Echo so it is there we start:

Kolf said one of the reasons the city’s mandated audit is being held up is because the auditor is concerned that the utility rates aren’t high enough to pay everything and are a “going concern.”

If the city fails to raise rates, he said, that could make the bank trustees in charge of the bond nervous and they could legally require the city to pay the funds back immediately.

Falgout countered that the auditor is concerned about far more than the city’s utility budget.

So we getting this folks, we have the City Clerk blaming the Going Concern opinion on just the Utility Fund while the Auditor’s are telling the City Council they are concerned with the entirety of the City’s dismal financial situation. Kolf used that misconception in an attempt to strong arm the City Council into adopting the Mayor’s Utility rate hike, a proposal that according to Councilman Joey Boudin the council saw for the first time just before the start of the recessed meeting.

But there is more because the finger wagging from Clerk Kolf and City Attorney Rafferty was just beginning:

City attorney Donald Rafferty told the council he felt the proper thing to do would be to announce to the bank trustees that the city likely not be able to make the first payment on the refinanced bond.

Last night, the $9/month water and sewer rate increase proposed by Mayor Les Fillingame failed to gain the support of four of the City Councilmen. Councilmen Doug Seal, Lonnie Falgout, Mike Favre and Joey Boudin all voted no on the Mayor’s proposal.

City Clerk David Kolf addressed the outstanding FY 2013 audit, specifically the proposed going concern opinion on the City’s FY 2013 Financial Statements, which Kolf blamed solely on the Utility Fund as he attempted to use the proposed going concern opinion to justify the Mayor’s rate hike. Kolf was countered by Councilman Falgout, who indicated the Auditors’ proposed opinion, per his discussion that day with Auditor Jennifer Bell, was derived from the overall poor financial condition of the City.

Falgout, explaining his no vote on the rate hike, wants to undertake a comprehensive review of the City’s finances as he indicated the latest financial reports show that several revenue sources in the City’s general fund, including sales tax collections, continue to decline year over year.

Horrifying isn’t too strong of a term to describe what I witnessed back on May 6th during the City Council’s finance workshop. Hopefully I’ll be able to explain why I was horrified as the subject matter is somewhat technical in Mississippi Municipal Finance. From a big picture standpoint, financially the City of Bay St Louis is a rogue municipality, making loans without any statutory authority to do so while spending fantasy tax revenue, unrealistically budgeted and never received. Worst of all is the Mayor is in deep denial – either that or he gets his kicks from telling whopper after whopper about the state of the City’s finances. It does not serve the public interest.

To me, there were two moments that encapsulated the entire two hour workshop the first was when auditor Jennifer Bell was giving her presentation on the internal control and legal compliance findings.

To set up her finding on purchasing, rumors have been swirling since last August the City was financing its deficit using what is most commonly known as its trade payables, or in Mississippi Governmental parlance its claims docket. Whether a local government or a struggling business, when cash gets tight the first way operating cash flow is financed without a bank is to simply let bills ride until the money comes in to pay them. Robbing Peter to pay Paul is a time honored way of buying time in the business world for cash starved entities public and private. Unfortunately Mayor Fillingame and City Clerk David Kolf have been telling whoppers about the City’s cash flow being A-OK for months so when the rubber met the road the Mayor essentially accused the auditor of fabricating her results. Dwayne Bremer’s story on the workshop made it sound like it some sort of difference of opinion. Here is the salient snippet:

Falgout said the draft audit states that the city is experiencing a cash-flow problem and that bills were being paid in order of priority, rather than order received.

Fillingame said that he challenged the assertion and pointed to the fact that the audit is not yet complete.

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